Administrative Management:

Administrative Management: French industrialist Henry Fayol, a prominent European management theorist, developed a general theory of management. According to Fayol, the business operations of an organization could be divided into six activities.

Business Operations of an Organization














Fayol focused on the last activity, managerial activity. Within this, he identified five major functions: Planning, organizing, commanding, coordinating and controlling. To perform these functions efficiently and effectively, he outlines fourteen principles of management:

1. Division of Work: According to this principle, right job is assigned to right person according to specialization only.

2. Balance between Authority and Responsibility: According to Fayol, there should be balance between authority and responsibility of the employees. Giving too much responsibility will result in stress and low morale and giving too much authority can mislead the objectives.

3. Discipline: Discipline is vital for smooth running of an organization. It involves obedience of authority, adherence to rules, respect for superiors and dedication to one’s job.

4. Unity of Command: Each employee should receive orders or instructions from one superior only.

5. Unity of direction: Activities should be organized in such a way that they all come under one plan and are supervised by only one person.

6. Subordination of individual interest to the general interest: Individual interests should not take precedence over the goals of the organization.

7. Remuneration: Fair compensation, based on factors like business conditions, cost of living, productivity of employees and the ability of the firm, should be paid to employees.

8. Centralization: Depending upon situation, centralized or decentralized approach should be adopted.

9. Scalar Chain: This refers to the chain of authority that extends from top to bottom. This also refers the communication path of an organization.

10. Order: This refers to the both material and social order in organization. Material orders indicate that everything is kept in the right place to facilitate the smooth coordination of work activities. Similarly, social order indicates that the right person should be placed for right job.

11. Equity: All employees should be treated fairly and equally without prejudice.

12. Stability of Tenure of Personnel: A high labor turnover should be prevented. The frequent changes in the work and workplace of the employees should not be changed frequently and they should be motivated to do the better job they are assigned off.

13. Initiative: Managers should take initiative for each and every work going on. Employees should be encouraged to give suggestions and develop new and better work practices.

14. Espirit de Corps: This means “a sense of Union”. Management must inculcate the team spirit in its employees.

3. Bureaucratic Management: It emphasizes the need for organizations to function on a rational basis. Max Weber was one of the major contributors to this thought. According to him “ a bureaucracy is a highly structured, formalized and impersonal organization.” The term ”bureaucracy“ is sometimes used to be denoted “Red Tapism”.

Major characteristics of Weber’s ideal bureaucracy are:

Work Specialization and Division of Labor: The duties and responsibilities of all the employees are clearly defined. Each employee is given a particular task to perform repeatedly so that he can acquires expertise in that task.

Abstract Rules and Regulations: The rules and regulations are well defined to instill discipline to ensure that employees work in a coordinated manner.

Impersonality of Managers: Managers make rational decisions and judgments purely based on facts. They try to be immune to feelings like affection, enthusiasm, hatred and passion so as to remain unattached and unbiased towards their subordinates.

Hierarchy of Organizational Structure: All the activities are monitored by immediate superiors. Subordinates do not take any decisions and for same they have to look up.